When Gaming and Leisure Properties, Inc. made an offer just a few months back to purchase all of Pinnacle Entertainment, Inc.’s real estate assets, Pinnacle quickly shrugged GLPI off. In July, GLPI came back with a substantially higher offer, this time for .75 billion in an all-stock transaction, an offer too nice for Pinnacle to refuse.
The transaction came as no shock, as Pinnacle has been in talks regarding a real-estate investment trust split, and GLPI is seen as the gold standard for REITs within the gaming industry, having split from Penn National Gaming in 2013 with much success.
The acquisition of property will increase GLPI’s current portfolio of 21 properties across 12 states to a total of 35 casino and hotel assets spread throughout 14 states. GLPI Holdings, Inc., which falls under the umbrella of GLPI, will still own and operate two gaming properties in Baton Rouge, Louisiana and Perryville, Maryland.
GLPI is predicting the acquisition will provide an immediate impact, and will deliver low double-digit percentage increase in annual dividend per share in its first full year. The combination will be the third largest publicly traded triple-net REIT, while adding $377 million in initial rent revenues to GLPI in the first year after close.
Anthony Sanfilippo, chief executive officer of Pinnacle Entertainment, said, “This is a compelling transaction that unlocks the value of Pinnacle’s real estate assets and delivers substantial value to our shareholders.”
Peter Carlino, chairman and CEO of GLPI, had similar positive feelings, saying, “Pinnacle’s real estate portfolio brings great properties to GLPI and adds one of the leader gaming operators as a new tenant.”